Karnataka High Court
Anuradha Anil B vs Shreekrishna C H @ Krishana Bhat on 28 May, 2024
1 CRL.A NO.473 OF 2018
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 28TH DAY OF MAY, 2024
BEFORE
THE HON'BLE MS.JUSTICE J.M.KHAZI
CRIMINAL APPEAL NO.473 OF 2018
BETWEEN:
ANURADHA ANIL B
W/O ANIL BHASKAR
AGED ABOUT 50 YEARS
R/AT NO.B/102, 1ST FLOOR
PRAMUK TEMPLE MEADOWS
27TH CROSS, BANASHANKARI 2ND STAGE
BENGALURU - 560 070
......APPELLANT
(BY SRI. ANAND MUTTALLI, ADVOCATE)
AND:
SHREEKRISHNA C H @ KRISHANA BHAT
R/AT FLAT NO.305, 3RD FLOOR
SAI SRINIVAS HILLS, 1ST MAIN ROAD
4TH PHASE, BANASHANKARI 3RD STAGE
KATRIGUPPE EAST, BENGALURU - 560 085
....RESPONDENT
(BY SRI. R SRINIVAS, ADVOCATE - ABSENT)
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
378(4) OF CR.P.C PRAYING TO SET ASIDE THE ORDER OF
JUDGMENT PASSED IN CRL.APPEAL NO.1170/2016 DATED
09.01.2018 AND CONFIRM THE ORDER PASSED IN
C.C.NO.22634/2015 DATED 08.09.2016 IN THE COURT OF
THE XXII ADDL. CHIEF METROPOLITAN MAGISTRATE,
BENGALURU AND CONVICT THE RESPONDENT / ACCUSED IN
THE INTEREST OF JUSTICE.
THIS APPEAL HAVING BEEN HEARD AND RESERVED ON
01.04.2024, COMING ON FOR PRONOUNCEMENT OF
JUDGMENT THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
2 CRL.A NO.473 OF 2018
JUDGMENT
In this appeal filed under Section 378 (4)of Cr.P.C,
complainant has challenged the acquittal of
respondent/accused for the offence punishable under
Section 138 of Negotiable Instruments Act, 1881 (for
short 'N.I. Act'), by the Sessions Court by reversing the
conviction imposed by the trial Court.
2. For the sake of convenience, parties are
referred to by their rank before the trial Court.
3. It is the case of the complainant that accused
is a family friend having known since five years. During
the first week of April 2012, accused approached
complainant for financial accommodation of Rs.20 lakhs
for further development of his real estate business at
Bengaluru and also for his family and personal necessity.
He said that he has invested huge money into real estate
business and incurred some financial problems and if
financial assistance is not provided, he would suffer great
loss. Accused promised to repay the loan amount within
one month with interest at 1.7% per month.
4. It is further case of complainant that she
pledged her gold jewellery at Lakshmi Mahila Sahakara
Bank Niyamitha and arranged for only sum of Rs.16.7
lakhs. She lent the same to the accused. Accused
benefited by the hand loan received from the
complainant as his business got unexpected profits of
more than his expectation. However, after one month
accused failed to repay the same. Despite repeated
request and demand accused went on postponing. After
much negotiation, accused agreed to pay a total sum of
Rs.20 lakhs towards principal and interest. Out of it, he
paid cash in a sum of Rs.5 lakhs and issued cheque
dated 05.05.2015 for Rs.15 lakhs and assured prompt
payment on presentation.
5. On 06.05.2015, complainant presented the
cheque through her account. To her shock and surprise,
it was dishonoured with endorsement "Payment stopped
by drawer". When it was brought to the notice of
accused, he requested to re-present the cheque.
Accordingly on 09.07.2015, once again complainant
presented the cheque through her account. Again, it was
dishonoured for the same reason. In this regard,
complainant got issued legal notice to the accused
demanding the payment of amount due under the
cheque. Intentionally the accused has not claimed the
notice and sent it back. He has not paid the amount due
under the cheque and has also not sent any reply and
hence, the complaint.
6. After due service of summons, accused has
appeared before the trial Court and contested the case
by pleading not guilty.
7. To prove the allegations against the accused,
the complainant has examined herself as PW-1 and the
Senior Manager of Axis Bank, Jayanagar branch as PW-2.
She has got marked exhibit P1 to 11.
8. The report given by the bank regarding stop
payment instructions given by the accused is marked as
Ex.C1.
9. During the course of his statement under
Section 313 Cr.P.C, the accused has denied the
incriminating evidence led by the complainant.
10. Accused has led evidence by examining
himself as DW-1. No documents are marked on his
behalf.
11. Vide the impugned judgment and order the
trial Court has convicted the accused, sentenced him to
pay fine of Rs.5,000/- and compensation in a sum of
Rs.30 lakhs with default sentence.
12. Aggrieved by the same, the accused
approached the Sessions Court in Crl.A.No.1170/2016.
The Session Court allowed the appeal and acquitted the
accused.
13. Aggrieved by the same, the complainant has
filed this appeal, contending that the order under appeal
is illegal, opposed to law and probabilities of the case and
as such liable to be set aside. The trial Court on proper
appreciation of oral and documentary evidence held that
the allegations against accused are proved and without
any justifiable grounds, the Sessions Court has set aside
the same and it calls for interference by this Court. The
Sessions Court has failed to appreciate ample material
placed on record by the complainant to prove the
allegations against accused. The findings of the Sessions
Court are contrary to the evidence on record and as such
perverse. Viewed from any angle, it is not sustainable
and pray to allow the appeal, restore of the judgment
and order of the trial Court.
14. On the other hand, learned counsel for the
accused supported impugned judgment and order passed
by the Sessions Court and sought for dismissal of the
appeal.
15. Heard elaborate arguments of both sides and
perused the record.
16. Thus, it is the definite case of the complainant
that in consideration of the fact that accused is a family
friend and at his request to bail him out of financial
difficulty, complainant advanced hand loan of Rs.16.7
lakhs, which the accused undertook to repay within a
period of one month with interest at 1.7% per month,
but failed to keep up his promise. Upon much
persuasion, accused agreed to pay a total sum of Rs.20
lakhs towards principal and interest and in fact paid a
sum of Rs.5 lakhs in cash and for the balance issued the
subject cheque for Rs.15 lakhs. However, to the utter
shock and surprise of the complainant, it was
dishonoured on the 'Stop payment' instructions by the
accused. Therefore, after issuing legal notice complaint is
filed.
17. The accused has denied the entire case of the
complainant. He has come up with the defence that the
husband of complainant was running ice cream business
which suffered loss. Therefore, accused offered to run
the said business jointly with the husband of
complainant. At that time, he had issued a blank cheque,
by way of security. The said ice cream business also
suffered loss. Making use of the said cheque, this
complaint is filed after lapse of three years. The accused
has also challenged the financial capacity of complainant
to lend him Rs.16.7 lakhs and claimed that complainant
had to pledge her ornaments to take care of her financial
difficulties and when such being the case, question of
lending any hand loan to the accused would not arise.
18. Since the accused is disputing that the legal
notice was served on him, it is necessary to examine this
aspect before going to the merits of the case. According
to the complainant the legal notice as per Ex.P5 sent to
the accused is returned with endorsement not claimed.
Accused is not disputing his address to which the legal
notice was sent. In fact, it is the same address which is
given in the complaint. In the complaint filed by him
before the Sessions Court challenging his conviction also,
the accused has given the same address. During his
cross-examination, he has admitted that the address
noted on the postal envelope through which legal notice
was sent to him is correct. When suggested that
intentionally he has not received the legal notice,
accused has stated that at that time he had gone to his
native place and the notice might have been returned.
19. As per Section 27 of the General Clauses Act,
when any document is required to be served by post, the
service shall be deemed to be effected by properly
addressing, preparing and posting by registered post a
letter containing the document and unless the contrary is
proved to have been effected at the time at which the
letter would be delivered in the ordinary course of the
post. When the address to which the legal notice was
sent is the correct address of the accused and when the
postman has delivered intimation, the accused was
supposed to collect the envelope. After receipt of such
information when the accused has failed to collect the
post, it pre-suppose that intentionally, he has not
received the legal notice.
20. Therefore, it is not open to the accused to say
that legal notice is not served on him. Moreover, as held
by the Hon'ble Supreme Court in C.C.Alavi Haji Vs.
Palapetty Muhammed and Anr. (Alavi Haji)1, the object
of issue of legal notice is to enable a prompt drawer to
make payment of the amount due under the cheque so
as to escape from the ignominy of criminal trial. It is not
the case of the accused that had he received the legal
notice, he would have paid the amount due under the
cheque. In fact in Alavi Haji, the Hon'ble Supreme Court
further held that where the accused contend that the
legal notice is not served on him, after receipt of
summons from the Court, he may within 15 days deposit
the amount due under the cheque and request the Court
to dismiss the complaint as there is compliance of the
legal notice. Since the accused is disputing that he has
borrowed any loan from the complainant, question of he
(2007) 6 SCC 555
paying the cheque amount within 15 days of his
appearance before the trial Court would not arise. Thus,
from the above discussion, this Court is of the considered
opinion that there is proper compliance of requirement of
proviso (b) to Section 138 of N.I Act.
21. Now coming to the merits of the case. Having
regard to the fact that the cheque in question belongs to
accused, drawn on his account maintained with his
banker and it bears his signature, presumption under
Section 139 of N.I. Act is operating in favour of the
complainant, placing the initial burden on the accused to
prove that the cheque was not issued towards repayment
of any legally recoverable debt or liability and on the
other hand to establish the circumstances in which the
cheque has reached the hands of the complainant.
22. However, in John K.Abraham Vs. Simon C.
Abraham & Anr (John K.Abraham)2, the Hon'ble
Supreme Court held that in order to draw presumption
(2014) 2 SCC 236
under Sections 118 and 139 of N.I Act, the burden lies
on the complainant to show that:
(i) She had the requisite funds for advancing
the sum of money/loan in question to
accused.
(ii) The issuance of cheque by accused in
support of repayment of money advanced
was true and
(iii) The accused was bound to make payment
as had been agreed while issuing cheque in
favour of the complainant.
23. In Tedhi Singh Vs Narayan Das Mahant (Tedhi
Singh)3, Hon'ble Supreme Court held that where the
accused has failed to send reply to the legal notice
challenging the financial capacity of the complainant, or in
the reply notice has not challenged the financial capacity,
at the first instance, complainant need not prove his
financial capacity. However, at the trial if the financial
capacity of complainant is challenged, then it is for the
complainant to prove the same. As noted earlier in the
present case, the accused has not sent rely to the legal
2022 SCC OnLine SC 302
notice challenging the financial capacity of the
complainant. However, at the trial he has done so and
therefore burden is on the complainant to prove hers
financial capacity.
24. In APS Forex vs Shakti International Fashion
Linkers Pvt. Ltd (APS Forex)4, the Hon'ble Supreme
Court held that when accused raises issue of financial
capacity of complainant, in support of his probable
defence, despite presumption operating in favour of
complainant regarding legally enforceable debt under
Section 139 of N.I. Act, onus shifts again on the
complainant to prove his financial capacity by leading
evidence, more particularly when it is a case of giving
loan by cash and thereafter issue of cheque.
25. In Vijay Vs. Laxman and Anr (Vijay)5,
K.Subramani Vs. K.Damadara Naidu (K.Subramani)6 and
K.Prakashan Vs. P.K.Surenderan (K.Prakashan)7, also
the Hon'ble Supreme Court held that the presumption
(2020) 12 SCC 724
(2013) 3 SCC 86
(2015) 1 SCC 99
(2008) 1 SCC 258
under Section 139 of N.I. Act, is a rebuttable presumption
and when accused rebut the same by preponderance of
probabilities, it is for the complainant to prove his case
beyond reasonable doubt including the financial capacity.
26. Keeping the ratio in the above decisions in
mind, it is necessary to examine whether the complainant
was having financial capacity to advance Rs.16.7 Lakhs to
the accused.
27. At the outset, it is relevant to note that
complainant is a Homemaker. She is not having any
income of her own. Even though she has stated that she
is also doing ice cream business, complainant has not
produced any documents to evidence this fact. On the
other hand accused has made a specific claim that it was
the husband of complainant who was doing ice cream
business, but suffered loss and therefore accused
intervened to help him in the said business and in that
context, he came to issue a blank cheque by way of
security. In fact, during her cross-examination dated
04.01.2016, complainant has stated that loss was
sustained within 5-6 months of commencing the ice
cream business. Though the complainant has disputed
that a blank cheque was issued by the accused, she has
admitted that since there was loss in the ice cream
business, accused volunteered to run the said business.
28. It is pertinent to note that according to the
complainant, when the accused allegedly sought hand
loan, complainant was not having the requisite funds
with her and therefore she chose to pledge her
ornaments and she paid Rs.16.7 lakhs to the accused by
way of hand loan. When the complainant was not having
the requisite money with her, absolutely, there was no
compulsion on her part for pledging jewels for the
purpose of lending money to the accused. She could
have very well refused to help the accused by giving the
said reason. Absolutely the complainant has not come up
with any compulsion on her part to help the accused by
pledging her jewel, that too without taking any
documents by way of security.
29. Ex.P8 to 11 are the consolidated account
statement in respect of the availment of loan by the
complainant by pledging the gold. As per these
documents, the loan in question granted by Sri Lakshmi
Mahila Co-operative Bank Ltd is transferred to the
account of complainant. During the cross-examination of
the complainant, the accused has elicited that at the
relevant point of time there was loss in ice cream
business and complainant and her family members were
in rented house paying monthly rental of Rs.13,000/-
during 2012. When she was cross-examined on
04.01.2016, complainant has stated that at that time she
was residing in a house paying monthly rental of
Rs.32,000/-. She has not disputed that advance is paid
but unable to state the exact figure.
30. It is elicited through the complainant that her
son is doing BBM course at PES College and for donation
and fees, they have deposited a sum of Rs.3 lakhs.
However, she has denied that for her personal need, the
loan in question was taken by pledging her gold
ornaments. Looking to the financial condition of the
complainant, it is doubtful whether she would go to the
extent of advancing hand loan to the accused by
pledging her gold when her financial situation was in a
precarious condition. Moreover, when the Bank has
credited the loan amount to her account, nothing
prevented her from transferring the said amount to the
account of accused and it would have safeguarded her
interest also.
31. On the other hand, the evidence of accused
reveal that from 2004 to 2009, he worked in Bajaj
Alliance Life Insurance Corporation and thereafter started
catering business, when he came to be acquainted with
the husband of complainant, who was doing ice cream
business and supplying ice cream to the accused for his
catering business. He has stated that the subject cheque
was given by him blank to the husband of the
complainant. When he joined him in the ice cream
business and after three months again, they suffered loss
and therefore, he left the side business, but the blank
cheque was not returned to him.
32. During his cross-examination, it is suggested
to the accused that when the talks were held regarding
his request for loan, the husband of complainant was
also present. It is also suggested that one Shenoy was a
common friend and through whom accused was
introduced to the family of complainant is also knowing
about the loan transaction between the complainant and
accused. Complainant could have examined her husband
and also Shenoy to prove the transaction between the
complainant and accused. During his cross-examination,
the accused has stated that for the ice cream business,
he had invested Rs.3 lakhs which fact is not disputed by
the complainant.
33. It is pertinent to note that in Ex.P1 cheque,
the signature of the complainant is in dark, whereas rest
of the writing is in different ink. It probabalise the
defence of the accused that a blank cheque was taken
from him. On being questioned by the complainant,
whether he is having any objection to send the subject
cheque for examination by the handwriting expert, the
accused has replied that he has no objection. However,
the complainant has not chosen to get the cheque
examined by the handwriting expert to show that the
cheque is filled up in the handwriting of accused.
34. Thus, the complainant has failed to prove her
financial capacity to lend a sum of Rs.16.7 lakhs to the
accused. On the other hand, the accused has proved his
defence that the cheque in question was issued blank to
the husband of the complainant and it is being misused
to file the complaint. The trial Court without examining
the evidence in proper perspective had convicted the
accused. On re-appreciation of the oral and documentary
evidence placed on record, the Sessions Court has rightly
interfered and acquitted the accused. This Court finds no
justifiable grounds to interfere with the finding of the
Sessions Court. In the result, the appeal fails and
accordingly the following:
ORDER
(i) Appeal filed by the complainant under
Section 378(4) of Cr.P.C is dismissed.
(ii) The impugned judgment and order dated
09.01.2018 in Crl.A.No.1170/2016 on the
file of LXIV Addl.City Civil and Sessions
Judge, Bengaluru, reversing the judgment
and order dated 08.09.2016 in
C.C.No.22634/2015 on the file of XXII
ACMM, Bengaluru, is hereby confirmed.
(iii) The Registry is directed to send back the
trial Court as well as Session Court
records along with copy of this judgment
forthwith.
Sd/-
JUDGE
RR
